U.S. GDP booms at 33.1% rate in Q3, better than expected

Coming off the worst quarter in history, the U.S. economy grew at its fastest pace ever in the third quarter as a nation battered by an unprecedented pandemic put itself back together.

Third-quarter gross domestic product, a measure of the total goods and services produced in the July-to-September period, expanded at a 33.1% annualized pace, the Commerce Department reported Wednesday.

That came after a 31.4% plunge in the second quarter and was better than the 32% estimate from economists surveyed by Dow Jones. The previous post-World War II record was the 16.7% burst in the first quarter of 1950.

The powerful growth pace came after governments across the country shut down large swaths of activity in an effort to stem the spread of Covid-19, which the World Health Organization declared a pandemic on March 11.

Since then, some 228,000 American lives have been lost to the virus, which has infected nearly 9 million. The economy has been in a technical recession since February, as first-quarter growth declined at a 5% pace.

Q3 growth came amid a resurgence in consumer activity, which comprises about two-thirds of GDP. Though most of the country remained in a cautious reopening, shoppers began returning to stores and the bar and restaurant industry entered the first tepid phase of resuming business despite restrictions on capacity.

Economic activity was strong in the real estate sector, and consumer and business executive surveys showed that confidence has remained high about the future despite the virus-related setbacks.

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